Quicksilver's 2nd well at Wolf Mountain gets nod of approval

Steamboat Springs  Editor's note: This story had been updated to correct a quote from Routt County Planning Commission member John Ayer.

The Routt County Planning Commission voted, 7-2, on Thursday night to recommend approval of a permit for Quicksilver Resource’s second exploratory oil well on Wolf Mountain about six miles northeast of Hayden.

The permit application next goes to the Routt County Board of Commissioners at 5:30 p.m. March 12 for a possible final decision.

The vote came at the end of a 3 1/2-hour hearing including 90 minutes of comment from the public with roughly equal numbers of people expressing their support or opposition for the proposed well.

In the end, Planning Commissioner John Ayer moved to send the application on to the next level, saying he felt the combination of Colorado Oil and Gas Conservation Commission regulations and the county’s conditions of approval were adequate to protect the public interest. He added that he thinks unusually robust conditions in the surface rights agreement that Wolf Mountain Ranch owner Bob Waltrip negotiated with Quicksilver provide county residents with even more assurances.

Ayer said he thought it was premature to place the burden of remedying social issues, such as impacts on public schools and the need for basin-wide air-quality testing, on Quicksilver.

“We do look at cumulative effects in our planning regulations. The trigger is not there,” Ayer said while making the motion to approve. “The full weight should not fall on a single operator for a single well. If we approve this, it will be with the belief we have adequate mitigation for this one well at this one location.”

Benjamin said that he thought Quicksilver would prove to be a good operator but that he could not reconcile himself to the well’s location.

“The proximity of the well to the Yampa River makes it not a good location for an oil well,” Benjamin said.

The well is about a mile from Quicksilver’s first well, which it acquired from another company in 2011. The Yampa flows close to the road just downstream from the U.S. Highway 40 bridge near the base of the hill.

Planning Commissioner Alan Goldich had offered an amendment that would have required Quicksilver to carry out baseline air-quality testing in the vicinity of the well, which also is close to the Hayden Station power plant, but Ayer did not accept it.

Gibson agreed with Goldich and added that she was not in favor of Quicksilver’s request to carry out the drilling process in two phases.

Quicksilver originally had planned to seek a permit for the Camilletti well it plans west of Milner; however, it asked to have that permit application tabled and instead sought Routt County Planning Department Director Chad Phillips’ approval to advance the second well permit application on Wolf Mountain. The change was made in order for Quicksilver to live up to continuous drilling terms contained in its lease with Waltrip.

The first phase would be drilled to a depth of 1,200 feet using a 60-foot surface rig. Quicksilver expects that phase to begin by March 22, pending issuance of permits. The company plans to complete the first phase by March 31. After that, the operation would shut down for the balance of the sage grouse mating and chick-rearing season.

The first phase of the new well would use water-based fluids and no fracking is involved, according to documents at the planning department. Surface casing also would be set and cemented in the first phase.

Quicksilver Senior Director of Government and Community Affairs Steve Lindsey said the casing is critical to protecting groundwater.

“We have a robust casing and cementing program to ensure the integrity of the well bore over the life of the well,” Lindsey said. “We are always required to submit a cement bond log back to the state to assure it was done to their standards.”

After the initial drilling, the rig would be removed from the site.

The final drilling operations are proposed to begin in August, beyond the July 30 end of grouse restrictions. A conventional rotary drill about 160 to 165 feet tall would complete the vertical drilling process.

Lindsey said Quicksilver will cooperate with the Oil and Gas Commission’s voluntary baseline water-quality testing program at the new well.

Lindsey said his company is leaning toward using a gas fracking process on the second well as it did on the first.

A sampling of public comments includes:

Steamboat resident Steve Lewis said, “I’d like to take advantage of the resources in Routt County, but I’d like to make sure we don’t get hurt, as well. I do feel like we should be careful. I’d like to partner with Quicksilver, but I’d like to do it when we know what we’re doing. The real issue is well casing failures below grade.” The reason is unknown, “but there’s a study under way, and we should” wait for the results of the study.

Tom Maneotis, of Oak Creek, said that Quicksilver had been more than fair with him in their business dealings and that he thinks Routt County needs the tax revenue that energy development could generate.

“I’m concerned about the state of the county,” Maneotis said. With energy development, “severance taxes to the county could quadruple.

“I was one of the first landowners that probably leased my minerals to them. Subsequently down the road, the (value) of leases went up.” Quicksilver’s landman “came to visit and said the mineral leasing price went up and you only got half of what everybody else is getting. We’re going to make you equal.”

Comments

Thanks for the quote Tom, but I thought my readings from ProPublica were much more important:

"Colorado Study Links Methane in Water to Drilling"
April 22, 2009

"The Garfield County report examined… over 700 methane samples from 292 locations and found that methane, as well as wastewater from the drilling, was making its way into drinking water not as a result of a single accident but on a broader basis."

"Duke University… group tested 68 drinking water wells in the Marcellus and Utica shale drilling areas in northeastern Pennsylvania and southern New York State. Sixty of those wells were tested for dissolved gas. While most of the wells had some methane, the water samples taken closest to the gas wells had on average 17 times the levels detected in wells further from active drilling. The group defined an active drilling area as within one kilometer, or about six tenths of a mile, from a gas well.

The average concentration of the methane detected in the water wells near drilling sites fell squarely within a range that the U.S. Department of Interior says is dangerous and requires urgent “hazard mitigation” action, according to the study."

Fred,
Today you warn of "ultimatums, petitions and intimidation".
Two days earlier you feared a conspiracy of "surrogates and ringers".
Before that you wrote of underhanded "assassins" and the enviros true agenda - crashing the NG economy.

Date of Alleged Violation: 9/1/2009
COGCC received a complaint from Mr. Norman Anderson in August 2009, regarding concerns that his domestic water well had been impacted by nearby oil and gas wells. COGCC collected a water sample from the well (DWR Permit #280098) on August 11, 2009. The water sample contained 17 mg/L dissolved methane and results of isotopic composition confirmed a thermogenic gas source. As a result, COGCC requested all oil & gas operators with wells within a half mile of the impacted water well to perform bradenhead tests. The bradenhead test performed at the Dupper #2 on October 1, 2009, indicated a hole in the production casing. COGCC collected a bradenhead gas sample from the well on the same date. The isotopic composition of the bradenhead gas sample was nearly identical to the sample collected from the Anderson water well. Based on this data, COGCC concluded that the apparent release from the Dupper #2 is the source of thermogenic impact to the Anderson water well.

Abatement or Corrective Action Required to be Performed by Operator
Provide the Anderson residence located at 22063 County Road 42, LaSalle, Colorado 80645 with an alternate potable water supply to be used for drinking water, household use, landscape and livestock watering. Provide the means to convey the alternate water supply to the residence. Water supply shall be of sufficient quality and quantity to meet normal household needs. Submit a Form 27 to COGCC documenting the proposed alternate water supply with a schedule to provide the water supply. The Form 27 shall also include a plan for mitigation and monitoring of the release associated with the Dupper #2.

IN THE MATTER OF ALLEGED VIOLATIONS OF THE RULES AND REGULATIONS OF THE COLORADO OIL AND GAS CONSERVATION COMMISSION BY EDDY OIL COMPANY, WELD COUNTY, COLORADO

Based on the known scientific information, it is not possible to affix a date certain as to when Eddy Oil’s operations at the Well initially caused the contamination of the Laramie-Fox Hills Aquifer as detected in the Anderson WW on August 1, 2009. On October 1, 2009, due to the results of the bradenhead test at the Well, COGCC Staff concluded that a hole in the production casing provided a route for contamination of the Laramie-Fox Hills Aquifer by produced gas from the Codell Formation. On October 26, 2009, Eddy Oil contacted COGCC Staff and obtained verbal plugging orders for the Well. For the purpose of settling this matter under terms agreed to under this Administrative Order by Consent (“AOC”), the parties have agreed to use a period of 26 days of alleged violation (from October 1, 2009 through, and including, October 26, 2009).

Based on the above facts, COGCC Staff contend that a hole in the production casing in the Well resulted in a significant waste of oil and gas resources and a significant adverse impact on public health, safety or welfare or the environment as it pertains to Rule 324A.a. COGCC Staff further contend that Eddy Oil’s failure to maintain a casing program to prevent the migration of produced gas from Codell Formation in the Well to the Laramie-Fox Hills Aquifer resulted in the degradation and contamination of ground water.

Eddy Oil does not admit liability for any of the alleged Rule violations, and denies that such alleged violations caused a significant adverse impact to the environment. However, Eddy Oil agrees to pay the following fines as adjusted pursuant to Finding No. 27 and the COGCC Staff agrees to accept the following fines as adjusted pursuant to Finding No. 27. Both parties agree to do so in order to resolve this matter without the necessity of a contested hearing.

Steve,
I agree with the Comunity Allliance on many matters, tactics is not one of them. Shutting down fossils is their goal nationwide and this situation will be no different. The volume of data here is no more than a smokescreen.
My suspicion here comes from past observation, Many of us grew up in a handshake atmosphere and these "behind the scenes" tactics really seem to have polarized our nation. Do you notice that the Sage Grouse has become our Spotted Owl, what a coicidence, whatever happened to the Snail Darter? The masters of these shenanigans at the same time like to present themselves as the adults in the room. The far left assumes that the rest of us are not capable of participating in a conversation or that we might question their logic. We all want a safe product, but using that angle as a political tool is insulting.
.

Fred,
I stood to speak at RCPC. I'm speaking to you now. "Behind the scenes?" ???
We all want a safe product, but arguing product safety is insulting. ????
A lengthy report from COGCC's own files is a smokescreen. Seriously?

February 27, 2012
Ms. Tisha Schuller
Colorado Oil and Gas Association 1660 Lincoln Street, Suite 2710 Denver, CO 80264
Dear Ms. Schuller,
It has recently come to our attention that your Association has paid for and is airing a radio advertisement about drilling and fracking in Colorado. The ad is here: http://www.coga.org/audio/Gov_Hickenlooper_HF_Rule_30sec.mp3
This ad contains this sentence: “Since then [2008] we have not had one instance of groundwater contamination associated with drilling and hydraulic fracturing.”

This sentence is not correct.

Specifically, our organizations have analyzed the 615 “Spill/Release Reports” (footnote1) (Form 19, 6/99) for oil and gas drilling and fracking reported to the Colorado Oil and Gas Conservation Commission (COGCC) in just one Colorado County (Weld) from 1/3/2008 – 1/5/2012. These publicly searchable reports (Table 1 below)available on COGCC’s website reveal that:
1. 44% of spills have impacted/contaminated (footnote2) groundwater.
2. 2.8% of spills have impacted/contaminated surface water.
3. 40% of spills have resulted in or been caused by berm failures.

Further, we have also reviewed the 1,000 Spill/Release Reports available on COGCC’s website for Weld County, dated 8/28/2003 – 1/05/2012 (the COGCC website only lists the 1,000 most recent reports). Those reports (table 2 below) reveal that:
1. 43% of spills have impacted/contaminated groundwater.
2. 3.1% of spills have impacted/contaminated surface water.
3. 43% of spills have resulted in or been caused by berm failures.

In addition, these reports are available for each the 40 oil and gas companies operating in Weld County, revealing that the bulk of the spills and contamination are due to a handful of companies.

Further yet, we randomly sampled 60 of the 1,000 Spill/Release Reports (6%) and generalized those results to create an estimate of total fluid contamination. Those results (Table 3 below) reveal that from these 1,000 Spill/Release Reports:
1. Up to 824,600 gallons of oil have been spilled/released and “unrecovered” in Weld County.
2. Up to 383,600 gallons of produced water has been spilled/released and “unrecovered” in Weld County.
3. Up to 547,400 gallons of “Other” fluid has been spilled/released and “unrecovered” in Weld County.
(“Other” may include fracking fluids.)
4. Up to 2.44 billion square feet of ground have been contaminated by spills and releases in Weld County.

The results above are just for one County, Weld, and are for only 1,000 Spill/Release Reports, and do not reflect spills and groundwater contamination prior to 8/28/2003 in Weld County, and do not reflect spills and contamination in the 41 other Colorado counties in which oil and gas drilling and fracking occur.

Because the statement in your radio ad is not correct, we request that you remove it from the airwaves.

Steve,
We are not arguing product safety, you are using it as a political tool.. This report is conducted by the Sierra Club, spittting on the ground would be catastrophic as viewed by these zealots. Who could withstand the scrutiny of those with an agenda to stop all fossil recovery nationwide.
Steve, you appear to be the local henchman for the enviro movement and I would like to be proven wrong but my statement "you ain't seen nothin yet" is likely to be proven phophetic.
The spills are worded as up to: This could mean only a thimble full and still fall in that category. Pouring over records may be meaningless, the only true test is to start from scratch and agree on monitoring standards. Again I find that internet jockeys usually usually have their wires crossed in matters that I am knowledgable. They become experts in matters that they know zilch about. To speak with any credibility one needs to have years of hands on experience. When I see an "expert" show on a construction site I can usually tell a lot just by body language, I suspect that this is also true in the oil patch.

Wow, i hope you and Fred can find some common ground. Given the divisiveness, special interest/hidden agendas of just about everything these day's, maybe only God can save our planet, but in the meantime I for one appreciate your efforts.

It is a fool's errand to view ground and surface water quality in terms of "henchmen" and ideology. And yes it is about product safety. Well casing failure and spill rates are simply unacceptable today. Taking half of the Sierra Club's number would be 28,000 acres of contaminated ground in Weld County alone. Quicksilver said that "Routt leads all other (Colorado) counties in historical production of oil with over 6,000,000 barrels of oil produced in its lifetime." With fracking that trend stands ready to explode. Routt must do this more safely than Weld County has.

The O&G industry has deservedly come under huge scrutiny that will make it better. Rushing this gas harvest in Routt before those improvements come is a mistake. With the longtime family held ranches of Routt, the number of current surface owners holding their oil and gas rights is likely high. I hope they will take pause in view of the known hazard, the market's rock bottom prices, and the welfare of their neighbors, and wait a few years to use this piece of their rightful portfolio.

A long time member of the Routt Planning Commission pointed to this ethic in praising an excellent surface owner's lease agreement negotiated for Pirtlaw. It was said to add needed layers of protections above County regs. I suspect the protections are for both the owner and the environment.

We can do this right if we slow down. Those portfolios are only improved by waiting to do this right.

rokboat I respectfully submit to you that God is not going to save our planet. He is going to destroy it with the second coming of Jesus Christ. Might be tonight, might be another 2000 years. If you are interested in learning more about this, the book of Revelation in the Bible discusses it. It is a very difficult read and hard to interpret. The "Left Behind" series of books made it very easy to understand and are a great read if you like the action/adventure genre. They are available at the library. About 10 books as I remember but it has been 5 or 6 years since I read them.

I suppose that my manner rankles some and I am against apple pie. I hope that my concerns are wrong and that we are working together to make winners. My long tenure as an observer leads me to be suspicious, will this time be different?
We have a nationwide network of ideologues that I believe are calling the shots here. Time will tell and maybe I will end up with the last laugh as I did on affordable housing, unfortunately that was nothing to laugh about.